CHINA: Brands urged to uphold responsibility at Yue Yuen

Thousands of workers began striking at the China shoe factory last week

Hong Kong-based advocacy group Globalization Monitor has issued an open letter to brands sourcing from the striking Yue Yuen factory in China - Adidas, Nike, and Timberland - demanding they uphold their corporate social responsibility.

Thousands of workers began striking at the Taiwanese-owned shoe factory last week. It is the second time this month that employees have protested over unpaid social insurance and housing funds and improper labour contracts.

Workers rejected management's latest offer earlier this week, pushing what has become the country's largest worker strike in recent history into its second week.

Employees at the Dongguan plant initially demanded back-pay for unpaid social insurance, but over the course of the last week workers have expanded their demands to include a 30% pay rise, a one-time payment based on seniority, or, in the case the factory does not meet other demands, monetary compensation for terminating the labor contract.

This, China Labor Watch (CLW) said, was due to management continuing to delay its reply and then delivering "an unsatisfying response" to workers.

Globalization Monitor says the dispute was triggered by a conspiracy between the Yue Yuen factory and the local government.

"The factory did not fully pay social insurance for the workers and the local government officials did not observe this unlawful practice. Workers also discovered the work contracts they are holding are not legally valid. They request the factory to pay back pension and housing fund arrears, re-sign valid work contract and raise the wage."

It added, however, that workers have ignored the role of international buyers in the dispute.

"Those buyers are much stronger and powerful. Yue Yuen supplies product for international big brands like Nike, Adidas, Reebok, Asics, New Balance, Puma, Converse, Salomon and Timberland. The workers have been producing shoes for these gigantic buyers and enterprises.

"Adidas and other international brands cannot ignore their corporate social responsibility in the labour dispute."

The labour rights group is suggesting Yue Yuen pays social insurance "immediately" for workers according to the actual wages they earn, and pay back the pensions in arrears over the years. In addition, it is calling for all of the factory's international buyers to share the worker social insurance payment with Yue Yuen.

"Perhaps the brands would say this problem is made by the government officials and the company and they are 'clean' from this. However, our experiences [tell us] brands are responsible and they covered compensation."

According to CLW, Adidas began moving equipment out of the production facility this week to be sent to another factory in Fujian Province. It urged the sporting giant to "rethink its choice" to pull out of Yue Yuen factory and "support a fair resolution between Yue Yuen and its workers".

Adidas, however, has said it is not pulling out of the factory and has no plans to do so. A Nike spokesperson said it was continuing to monitor the dialogue.

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